Belgium - Travel & Tourism: Leisure activity driven market (Strategy, Performance and Risk Analysis)
The Belgian travel and tourism industry has the potential to attract tourists from all over the world through its food and culture. However, since the country is small in size, it is unable to attract tourists in volumes equal to other destinations such as France, the Netherlands, Italy and Spain.
Belgium attracts tourists from neighbouring countries such as France, the UK, Spain and Italy. The country lies between France and the Netherlands, Germany and the UK, which makes the country accessible from all sides. As movement within Europe is easy due to the well-developed network of roads, tourists prefer land transport over air transport. Because of this, the airline industry’s performance in Belgium is average, with lower scores than the regional and global across all parts of the segment.
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International arrivals to drive tourist volumes in Belgium
In Belgium, international arrivals accounted for 53.2% of total tourist volumes in 2016. Belgium’s neighbors, such as the Netherlands, France and Germany, account for most of the country’s international arrivals. International arrivals increased at a CAGR of 3.1%, from 9.6 million in 2012 to 10.8 million in 2016, and is forecast to increase at a CAGR of 4.1%, from 11.1 million in 2017 to 13.0 million in 2021.
However, international departures posted a CAGR of -0.7%, from US$7.6 million in 2012 to US$7.3 million in 2016, owing to the weak economic climate in the Eurozone which made residents cautious about spending on traveling. However, it is forecast to increase at a CAGR of 2.0%, from 7.4 million in 2017 to 8.0 million in 2021, because of the country’s small size and its geographical proximity to key global tourism destinations such as France, Spain, and the UK
Increasing leisure trips to drive the car rentals market value
In terms of market value, car rentals are mainly preferred for leisure purposes. The market value of car rentals for leisure purposes stood at US$132.6 million in 2016 and is forecast to increase at a CAGR of 10.4%, from US$144.5 million in 2017 to US$214.8 million in 2021, owing to constant growth in domestic and inbound trips.
Revenue per passenger to increase over the forecast period
Revenue per passenger reached US$374.7 in 2016 and is expected to increase at a CAGR of 2.2% over 2017-2021 to reach US$418.0, owing to increasing trips via full-service airlines, driven by growing disposable income. Full-service airlines accounted for 50.8% of the total revenue per passenger in 2016. Revenue per passenger for segments such as charter, full-service and low-cost carriers declined during 2012-2016 at CAGRs of -4.9%, -4.4% and -2.9% respectively, owing to several factors such as declining disposable income, the volatile economic climate and terror attacks. However, they are forecast to grow at CAGRs of 1.5%, 2.0% and 3.9% respectively during 2017-2021.